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End American Political Madness? Change Philanthropy Law

08/04/2016 07:20 pm ETUpdated
Aug 05, 2017

You don't have to get congress to end Citizens United to take billions of dollars that are destroying democracy out of the American political system. You just need an Internal Revenue Service Rule change.

Most of the mess in American politics, education, the media, and religion can be traced to the philanthropic power politics of America's wealthiest families, who use laws intended to promote the common good to be employed politically to protect their power and money.

That's right, your favorite billionaires, from bogeyman George Soros to the conniving Koch Brothers, can funnel their millions each year that end up in unaccountable shadow PACs and faux grassroots groups AND they get a tax break because the money can come straight out of their "charitable" foundations.

Philanthropy is defined as "the desire to promote the welfare of others, expressed especially by the generous donation of money to good causes."

Need a museum? A park? Ask a rich guy, or a dead rich guy's trust or foundation to donate it. That, at least, is the theory.

Charitable Foundations were set up as a compromise with the über-rich of the early Industrial Revolution. The super elite bristled at paying out taxes, and preferred to "direct" their money towards the common good in their own way.

Wealthy egoists looking for their shot at immortality with names like Rockefeller and Carnegie and Koch have funnelled millions into buildings that bear their names which house public theaters, hospitals, libraries, and educational institutions that did not have to be built on the public dime.

Win-win, right?

Until someone figured out how to corrupt the system and put their thumb on the political scales in favor of America's wealthy.

Lewis F. Powell, Jr., an ultra-conservative lawyer, who ultimately became a Supreme Court justice, figured out a master plan that would use that giving to fund a secret war on the New Deal, communism, and liberal thinking.

Powell's neighbor, Eugene Sydnor Jr., commissioned him to write an anti-Communist manifesto, a. secretive memo to the U.S. Chamber of Commerce "Attack on the American Free Enterprise System," which later became known as the Powell Memorandum, which bestelling "Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right" author Jane Mayer describes as a brilliant blueprint to overthrow New Deal America.

"In the spirit of Hannibal, it called for a devastating surprise attack on the bloated and self-satisfied establishment, which regarded itself as nonpartisan but which the conservatives regarded as liberal. Carrying out this attack would be an alternative opinion elite that would look like the existing one, except that it would be privately funded by avowedly partisan donors intent on implementing a pro-business-- and, critics would say, self-serving-- political agenda."

To pay for the plan to change America, you need big cash. The acolytes of Powell found it first through an old-money radical, Richard Mellon-Scaife.

"This was the beginning of the legend of Richard Mellon Scaife as the dark spirit behind right-wing causes," he wrote in "A Richly Conservative Life," an unpublished autobiography that he began in 2009 after being diagnosed with inoperable brain cancer, to which Mayer was given access for her book.

"Dickie" Mellon Scaife began transforming private charitable foundations into a conservative weapon. These tax shelters were now a means of quietly funding projects in Powell's vision of quietly remaking the media, education, American politics and the courts so that the American industrialists would rule with minimal interference from the middle class and the poor, with women and minorities being kept in their place.

So congrats!! You've been punk'd, and largely by dead people from the early 20th who put the wheels in motion for our current catastrophes.

Long before Mellon-Scaife, his forebear, Andrew Mellon, one of the wealthiest men in America, was preaching "trickle down" economics.. In 1926! Let the rich keep their money, and they would spend it in society and the middle class and working poor would benefit.

Head of the Mellon Trust, a banker to America's most wealthy, he got himself appointed as the Treasury secretary to Warren G. Harding, then held on to that post through the administrations of Calvin Coolidge and Herbert Hoover.

The shepherd of greed, Mellon was the architect of the fiscal policies that led to our greatest financial catastrophe, the Great Depression, and to the mess that American politics and culture are in today.

Mellon was able to get the tax law set up to avoid inheritance taxes. Put the family millions in trust for the children, have the trust donate the majority of the interest on those millions into charitable foundations, and bring the effective tax on hundreds of millions of dollars, equivalent to billions in today's dollars, to zero while maintaining complete control of how the money was used in the public sector.

Politicians, unable to scrape together the money for major public projects, took the tax trade-off as a reasonable way to get the Mellons, and the other Robber Baron families, to pay for public works projects for which taxes on their income would have paid.

Mellon was not just the artful tax dodger. He was the was the regressive ringleader who wanted to stop, at all costs, the Progressive Movement: Unions, educators, and those seeking a more inclusive society.

American media preached "land of opportunity" myths while he and the rest of the ultra-wealthy made sure that their wealth and privilege remained unchallenged, and the poor and minorities remained in check.

From the Great Depression to the Civil Rights era, the common man fought back, and won. The New Deal, civil rights laws, and progressive laws to improve opportunities for education, restrict abuses of the environment, and break through the glass ceilings of white male power transformed America in a way that these elites despised, and wanted ended.

In the 1970s, around the time of the campaign of Richard Nixon, Richard Mellon-Scaife, one of Andrew's descendents, crossed the line.

He, and then the sons of John Birch Libertarian leader Fred Koch, used the money from their family trusts and foundations, and recruited the money of other old and new rich families, to set up the umbrella organizations that politically and socially have transformed American politics.

"The Kochs [have] waged a long and remarkable battle of ideas," Jane Meyer writes in her book "Dark Money." "They subsidized networks of seemingly unconnected think tanks and academic programs and spawned advocacy groups to make their arguments in the national political debate. They hired lobbyists to push their interests in Congress and operatives to create synthetic grassroots groups to give their movement political momentum on the ground. In addition, they financed legal groups and judicial junkets to press their cases in the courts. Eventually, they added to this a private political machine that rivaled, and threatened to subsume, the Republican Party. Much of this activism was cloaked in secrecy and presented as philanthropy, leaving almost no money trail that the public could trace. But cumulatively it formed, as one of their operatives boasted in 2015, a 'fully integrated network.'"

That network that they created with philanthropic money paying for personal power politics, not the public good, has been responsible for, among other things:

The Tea Party, rebranded recently as the "Freedom Caucus" that gridlocks government to unwind the New Deal and protect their rich patrons oil and timber interests;

The political climate and science denial that keep oil and coal interests rich, but are killing the planet.

Citizens United, which takes the money that flows out of the foundations and allows it to be used in unlimited amounts to propagandize the Uber-rich's politically and socially unpopular agenda and intimidate the American electorate;

Keeping education a profit center through needless testing and teacher union busting that robs millions of a quality education, discourages people from entering the education profession.

The debt system in higher education, and cost escalations that are putting a higher education financially out of reach for the middle and upper middle class.

The corruption of the judiciary, especially the Supreme Court by putting activist conservative judges in place under the guise of opposing activism.

The hamstringing of the news media and the misdirection of entertainment before information to dumb the voting public down to a controllable mass.

If the tax law is amended, so that charitable foundations can't use their money for political purpose, the whole shebang ends the next day. Will the Kochs and their wealthy friends spend hundreds of millions each election cycle when they aren't getting a tax break for it?

The Internal Revenue Service, perhaps the most reviled organization in the history of American governance by average Americans, could become the saviors of American democracy overnight.